MCLE Article: Faster and Fairer

Kathleen Mulligan is an administrative judge at the Los Angeles district office of the U.S. Equal Employment Opportunity Commission and is president of the EEOC Administrative Judges Association. Albert Sheen received his J.D. from Loyola Law School in May. This article does not reflect the official positions of the EEOC.

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Employment law practitioners know that the Equal Employment Opportunity Commission (EEOC) is the federal agency charged with investigating and prosecuting employment discrimination cases against state, local, and private employers.1 What they may not know is that the EEOC also performs an adjudicatory role for federal employees who bring antidiscrimination claims against their employing agencies. Almost 2.8 million federal employees, along with applicants for federal employment and former employees, may bring discrimination claims before the EEOC.2 Every year, its administrative judges (AJs) decide or settle thousands of federal sector discrimination claims,3 and the commission prosecutors file a few hundred cases in federal courts. Except for punitive damages, the substantive antidiscrimination law and the remedies applicable in EEOC cases are virtually identical to those in federal court, but in EEOC cases, the administrative process is quite different.

Federal antidiscrimination statutes protect against discrimination on the basis of race, color, religion, sex, pregnancy, national origin, age (40 or older), disability, or genetic information. The law also protects against retaliation for opposition to employment discrimination, filing a complaint of discrimination, or participating in the EEO complaint process as a witness.4 The EEOC's AJs are authorized to award to a prevailing complainant full equitable relief (back pay, lost wages, and benefits), compensatory damages up to the limit of $300,000 per claim, and attorney's fees.5

In 2009, federal agencies paid over $50 million to successful complainants.6 The EEOC's AJs also decide class action cases. In 2007 it was publicly reported that an EEOC AJ approved a $61 million class action settlement in which the U.S. Postal Service resolved disability discrimination claims of over 7,500 current and former postal workers, of which $53 million went directly to the class members.7 Another publicly reported case was resolved in 2006 by a $9 million settlement paid to female employees of the U.S. Mint in Denver, who alleged widespread sexually discriminatory employment practices as well as retaliation.8 The settlement also provided attorney's fees, injunctive relief, and the appointment of an independent monitor at the Denver facility.

Most EEOC cases, however, are never made public. The investigation and administrative hearings process remain confidential unless and until a case is appealed and decided by the commissioners, five presidential appointees from both political parties. Over 95 percent of appeals from AJ decisions are affirmed.9

Counseling

The federal sector EEO complaint process is greatly accelerated in comparison to that of the private sector, in which employees generally have up to 300 days from the date of the discriminatory action to file a claim.10 A federal employee has only 45 days from a discriminatory act to begin the administrative process, or the claim is subject to dismissal for untimeliness, absent special circumstances.11 The process is begun by contacting an EEO counselor at the agency12 to elect counseling or, if offered, ADR.13 Counseling is essentially an informal effort to obtain from management the most basic information about the disputed employment action and convey the information to the employee, so that any dispute based on misunderstanding may be resolved quickly and easily.

If the claim is not resolved in counseling, the individual may then file a complaint within 15 days of receiving notice from the EEO counselor that the counseling process has not succeeded. The notice provides information about how to file the complaint.14 The complaint must be signed, identify the aggrieved individual and the agency, describe generally the acts giving rise to the complaint, and provide contact information.15

Upon receipt of the complaint, the agency may dismiss all or part of the case for procedural reasons, including untimely filing, failure to state a claim, or lack of jurisdiction because the employee has elected a different remedy.16 The employee may object to, and the AJ later reverse, the dismissal.

The Agency's Investigation

If the complaint is not entirely dismissed, the agency will conduct an investigation that should be finished within 180 days from the date of filing.17 The EEOC's Management Directive 110, Federal Sector Complaint Processing Manual, describes the minimal qualifications of an investigator, who may be an employee or a contractor, and the proper investigative methodology to use depending on the issue and the basis raised.18 Investigators are rarely attorneys and rarely have advanced training in employment discrimination. Investigations may be supplemented with discovery later if the employee requests a hearing or goes to federal court.

The employee can ask for a hearing if more than 180 days pass without completion of the investigation.19 The agency should issue a notice after completing an investigation advising the employee that he or she may either 1) request an administrative hearing before an EEOC AJ within 30 days of receipt of the notice, or 2) ask the agency to issue a decision as to whether the discrimination occurred.20 If the employee asks the agency to issue a decision and no discrimination is found, or if the employee disagrees with some part of the decision, the employee can appeal the decision to the EEOC or challenge it in federal district court. An employee also has the right to file a federal lawsuit anytime after the 180-day investigation period has passed, even if the complaint is pending an agency decision or a hearing before an EEOC AJ.21 Once an employee files a lawsuit in federal court, however, the EEOC will close the complaint and take no further action.22

The vast majority of federal employees choose the administrative route over federal court. For the 12 months ending September 30, 2010, the United States was a defendant in only 653 employment civil rights actions commenced in federal district courts.23 In comparison, federal employees in fiscal year 2009 completed EEO counseling in 39,038 cases, filed 16,947 formal EEO complaints, and requested 7,277 EEOC hearings before an AJ.24 In the EEOC hearing process, the respondent agencies are virtually always represented by counsel, while the complainant employees often appear pro se or are represented by a union steward or other nonlawyer.

The Prehearing

After an employee requests an administrative hearing,25 the first order sent by the EEOC is the Acknowledgment and Order, which summarizes the procedures to be used before and after the hearing. The procedures generally mirror the prehearing and discovery procedures in the Federal Rules of Civil Procedure,26 except that the process is intended to be quicker and simpler. The discovery standard is slightly more focused (discovery must seek evidence that is relevant and not repetitious), and the discovery period is typically only 90 days.27 Extensions may be granted if the parties have made diligent efforts to conduct discovery, but the procedure is designed to expedite resolution. Without the AJ's approval, parties can serve only one set each of interrogatories, document requests, or requests for admission, with no more than 30 per set.28

EEOC AJs must ensure that the record is complete before issuing a decision. Especially if the complainant is unrepresented, the AJ must review the claims, defenses, investigation report, and any discovery responses to see that the record contains all the necessary information. The AJ may issue an order to either or both parties to produce evidence necessary to cure any deficiencies in the record.29 Remedies for discovery abuse include orders granting motions to compel, and if necessary, appropriate sanctions.

EEOC AJs are also authorized by regulation to conduct settlement conferences in cases assigned to them.30 Alternatively, the AJ may refer the parties to another judge or to an outside ADR program.31

As in federal or state court, EEOC hearing procedures provide for a "decision without a hearing," analogous to summary judgment, if no genuine issue exists.32 Parties may move for a decision without a hearing up to 15 days before the scheduled hearing date, or sooner if the AJ so requires. An AJ may also determine sua sponte to issue a decision without a hearing after providing the parties with due notice. Both parties have 15 days to respond and 5 days to file a reply,33 including a statement of undisputed material facts.34 AJs may grant extensions.

An AJ is precluded from issuing a decision without holding a hearing unless he or she ensures that the party opposing the ruling is given 1) adequate notice of the proposal to issue a decision without a hearing, 2) a comprehensive statement of the allegedly undisputed material facts, 3) the opportunity to respond to such a statement, and 4) the chance to engage in discovery before responding, if necessary.35 In EEOC administrative cases, the AJ determines the amount of discovery necessary to properly respond to any motion for a decision without a hearing.36

If the case is not dismissed and summary judgment is not issued, the AJ will conduct a prehearing conference to narrow and define the issues, explore settlement, and approve witnesses and exhibits. An order confirming the ruling will be issued to both parties. An AJ must assure the adequacy of the record, especially if a party is not represented by counsel. If a party is unrepresented and unfamiliar with what type of admissible evidence is relevant to the claim brought, the AJ is responsible for assuring that the investigation has at least obtained the minimal amount of reliable and relevant evidence so that a competent decision may be made.

Sanctions

Failure of either party to comply with an AJ's orders can have serious consequences. An AJ can issue a Show Cause Order directing either party to explain its noncompliance and show good cause why it should not be sanctioned. Possible sanctions include striking a claim, a defense, or evidence; drawing an adverse inference about evidence; or imposing costs.37

Practitioners should also note that EEOC standards for sanctions for spoliation of evidence have caused somewhat more frequent issuance of sanctions than in federal court (although Zubulake and succeeding cases have certainly brought the issue to the fore in federal district courts recently).38 While parties in federal court have traditionally faced sanctions for destruction of evidence only when 1) the parties knew or reasonably should have known that litigation was pending and 2) destroyed evidence intentionally, EEOC regulations39 require employers to preserve--without regard to pendency of litigation--all employment records related to an employment action for a year from creation and preserve records related to an EEO case from the beginning of the agency complaint process until the case is closed. Sanctions may include entry of default judgment or dismissal of a complaint.

Hearings

EEOC hearings follow general principles of administrative law. The hearings have no juries, employ somewhat relaxed rules of evidence and procedure, and are much faster and simpler than civil actions in federal or state court. EEOC hearings are closed to the public, but generally the presentation of evidence and witnesses follows standard trial procedure. The parties may offer exhibits and conduct direct and cross-examination of witnesses. Unlike federal or state court trials, hearsay evidence may be admissible if the AJ determines it to be reliable, relevant, and not repetitive.40 Hearings generally are not bifurcated.

AJs strive to issue decisions within 180 days of receipt of the complaint file from the employee's federal agency.41 The AJ's decision on motions or after the hearing has binding force if the agency does not appeal to the commission.42 The agency has 40 days from receipt of the AJ's decision to issue its final order informing the employee whether the agency will either appeal or accept the AJ decision and grant the relief ordered.43 If the agency fails to issue a final order within 40 days, the AJ's decision becomes the agency's final action in the complaint, and there is no further appeal for the agency. However, the employee may appeal an adverse AJ decision which has become final because the agency failed to issue any decision within 40 days of that decision.44

Class Cases

Administrative judges also certify and decide class actions. The grounds for certification of an EEOC class complaint are similar to those in federal Rule 23 class actions, requiring numerosity, commonality, typicality, and adequacy of representation.45 However, unlike a Rule 23 class action in federal court, an EEOC class complaint need only satisfy these four requirements, which are analogous to Rule 23(a)(1)–(4), and not the separate requirements under Rule 23(b). Thus the holding in Wal-Mart Stores, Inc. v. Dukes46 interpreting the requirements of Rule 23(b) does not apply to the language of EEOC regulatory requirements. Absent a reported commission or federal court case holding that EEOC procedures do not afford the minimum constitutional protections for defendant employers required as a matter of due process, Rule 23(b) requirements as set forth in Dukes would not be expected to bar EEOC class actions.

Employees who seek to file a class complaint must still go through the precomplaint EEO counseling process. At any reasonable time when it becomes clear that there are class implications in the complaint, a complainant may move for class certification.47 A potential class action case is not investigated by the agency but sent to the EEOC so that an AJ may develop the record through discovery and if necessary hold an evidentiary hearing.48 The AJ may approve class certification, reject class certification and return the case for individual investigation, or dismiss the individual complaint.49 If an AJ accepts a class complaint, the agency must notify all class members of the complaint's acceptance, and all individual claims are subsumed into the class complaint. No opt-out procedure is available.50 However, an agency may appeal the certification (and a complainant, the dismissal) of a class complaint to the commission or file a federal civil action.51 The agency has 60 days to accept the AJ decision or appeal to the commission.52 If the agency fails to issue its decision within 60 days, the AJ's decision becomes final.53

Whether the AJ certification becomes final because it is not appealed to the commission or because the commission affirms the AJ decision on appeal, the case then proceeds to discovery prehearing motions. If not dismissed, settled, or subject to summary judgment, the class case goes to hearing, usually before the same AJ who certified the case. The AJ may modify the certification ruling, create subclasses, or decertify the class based on new evidence.54 Settlements of class cases are subject to fairness hearings. If discrimination is found and a class member believes he or she is entitled to relief, the class member may file a written claim with the agency within 30 days of receipt of the notification decision. The AJ will adjudicate any disputed claims, and an agency must show by clear and convincing evidence that a class member is not entitled to relief.55

Remedies and Appeals

Although punitive damages are not available in claims brought against the federal government,56 the other remedies available to prevailing private sector employees are generally available. AJs may order compensatory damages, injunctive relief, attorney's fees, and costs.57 AJs can also order a remedy familiar to NLRB practitioners: an order to the agency to post in the workplace a notice that the agency has been found to have violated a federal antidiscrimination statute.58

Either or both parties may appeal an agency's final order (including a final order dismissing a complaint) to the commission.59 Likewise, if the agency disagrees with any part of the AJ's decision, it must appeal to the commission. An employee must file the appeal no later than 30 days after receipt of the final order.60 If either party does not agree with the commission's decision on the appeal, reconsideration may be requested within 30 days, but is granted only if the prior decision is based on a mistake of fact or law, or will have a substantial impact on the policies, practices, or operations of the agency.61

Once the commission decides a request for reconsideration, the decision is final for the agency, and there is no further appeal to any federal court. However, for the employee, the right to file in federal court still remains, although after losing at the EEOC, the employee faces the likelihood of dispositive motions based on the record before the EEOC.

For millions of federal employees, former employees, or applicants for employment, the EEOC administrative process provides a quicker and easier means of deciding the merits of a claim and obtaining relief. The EEOC federal sector hearings process is described on the EEOC Web site,62 which has a searchable database of recent federal sector appellate decisions63 as well as summaries of the federal statutes enforced by the EEOC and applicable federal regulations.64 Employment law attorneys should review these procedures and cases before appearing before an EEOC AJ.

SIDEBAR

The Powers of Administrative Judges

Administrative judges (AJs) have the following powers:

• To dismiss all or part of the complaint on the same bases that the agency could prior to investigating,1 on his or her own motion or on motion of the respondent agency.2• To reinstate issues previously dismissed by the agency, which may be returned to the agency for investigation, or may be subject to discovery by the parties, as determined by the judge.• To order the production of documents and attendance of witnesses.• To sanction noncomplying parties.• To regulate discovery prior to the hearing, including granting motions to compel and otherwise enforcing discovery rights and deterring abuse.3• To conduct settlement efforts prior to hearing and to issue, sua sponte after notice to the parties, a decision without a hearing if there are no genuine issues of material fact.4• To rule on a party's motion for decision without hearing.• To conduct prehearing conferences and issue prehearing orders that approve witnesses and exhibits.• To swear witnesses and conduct hearings.• To determine violations of the statutes enforced by the EEOC.• To award equitable remedies and compensatory damages for victims of discrimination, as well as attorney's fees and costs.5

The two provisions in Equal Employment Opportunity Commission (EEOC) procedures that differ from most state and federal court proceedings are that 1) hearings are deemed "part of the investigative process and thus closed to the public," and 2) AJs have responsibility for overseeing the development of an adequate record.6

Unlike an AJ, who cannot authorize subpoenas for information or testimony from third parties, a federal district court judge can issue subpoenas. AJs regularly make findings of fact and conclusions of law after hearing, which a district judge normally does not, since most federal court plaintiffs elect jury trials. An attorney may consider an AJ's written and reasoned decision, with findings of fact based on credibility determinations, to be an asset, because the AJ's decision offers an explanation, while jury forms merely provide a decision.

The Administrative Procedure Act (APA) does not control EEOC hearings. Therefore, EEOC AJs cannot issue subpoenas, and litigants are not assured of judicial independence. However, the American Bar Association, the National Association of Women Judges, and the National Lawyers Guild have all recently urged the EEOC to use its existing statutory authority to apply the formal hearing sections of the APA to EEOC hearings.7--K.M. & A.S.

1 29 C.F.R. §1614.109(a)–(b).2 29 C.F.R. §1614.109(b).3 29 C.F.R. §1614.109(b).4 29 C.F.R. §1614.109(g).5 See 42 U.S.C. §§1981a(a)(1), 2000e-5(g)(1),(k)(2006) (damages and attorney's fees in Title VII civil actions). See generally 29 C.F.R. §1614.501 (remedies and relief). However, punitive damages are not available against the federal government. See 42 U.S.C. §§1981a(a)(1), (b)(1).6 29 C.F.R. §1614.109(g); see also 64 Fed. Reg. 37657 (July 12, 1999).7 See ABA House of Delegates Res. 124 (Aug. 8, 2011) ("RESOLVED, That the American Bar Association urges the President, Congress, and the EEOC to adopt measures to provide that employment discrimination hearings conducted by the EEOC be subject to the formal adjudication requirements of the Administrative Procedure Act" (5 U.S.C. §§554, 556, 557)). The National Association of Women Judges adopted a similar resolution on Mar. 10, 2012 (see http://www.nawj.org/midyear_2012.asp), as did the National Lawyers Guild on Oct. 15, 2011. The EEOC has been authorized to appoint ALJs since 1978. 42 U.S.C. §2000e-4(a)(2) (1978).